Written by Gary
Opening Market Commentary For 12-13-2013
For those who are superstitious, today is Friday the 13th and it might be best to crawl into a box in a dark room and wait out the day.
Premarkets were up +0.20%, the oils were down and gold was up when the markets opened up and in the green. Opening volume was anemic by recent market standards giving no hints of market direction at the opening bell except being lackluster.
I have a free lunch today at the expense of several bankers so I will not have a Midday report and will see you at 4 pm.
Today was suspected to be a positive day following four previous decidedly negative sessions, but maybe investors decided it was back luck and are calling it a day. By the 15 minute mark the averages were showing signs of melting lower, but the volume was light and extremely difficult to determine what Mr. Market was going to do next.
Then out of the blue a very large red spike of volume and the $VIX edging up to15.26 stared the averages to melt downwards in slow motion where the markets were now in flat and lackluster territory. The DOW and SPY were the first to show red as the averages, unconvincingly I might add, headed south to the yesterday's low numbers. I am always watching for the BTFDers switch-a-roos sending the averages back up.
The problem facing traders is that the trading range, which has been so narrow during the trading day lately, is that way too much money has to be put on the table just to get back meager gains. Today appears to be another one in a long series of
The short term indicators are leaning towards the hold side at the opening, but I would advise caution in taking a position because of the Fed's cryptic utterances in hinting when the taper will begin and by how much. I would also take chart and other technical indicators with a grain of salt for the time being and watch what the Fed does WHEN it actually does something.
The longer 6 month outlook remains 40-60 sell until we can see what the Fed is actually going to do, simple as that. If we get some Fed tapering in December the markets will certainly react in a negative fashion, how much of course depends on much bond buying takes place. If the tapering begins in March 2014, like many believe it will, the markets are going to price that in by declining sooner. I am expecting weak to negative markets for the foreseeable future.
Members of the FOMC believe the US economy has shown signs of improvement, but they have assured short-term interest rates would remain low for quite some time to come. Alpari Market Analyst, Craig Erlam, said: "Many members of the Fed now appear eager to start winding down its asset purchases and are looking for ways to do it that will create the least disruption in the financial markets, such as setting simple thresholds for reductions, or even more simply, providing a timetable for tapering that is not data dependent."
ADVFN reported, "The rally in question has been built on the back of the Fed's promise of a stimulatory environment. If any catalyst points to the Fed giving up its accommodative stance, there is a danger of a pullback and near term support for the index lies around the 15,965, 15,890 and 15,804 levels."
Personally, I think it could go a lot lower.
Also, many pundits have stated that we may have seen the top - but I wouldn't count it as long as the Fed continues to hand out 'Market Viagra'! I would like to see a blowout candle (shooting star) to verify a top along with heavy volume.
The DOW at 10:00 is at 15750 up 10 or 0.06%.
The SP500 is at 1776 up 0.30 or 0.02%.
SPY is at 178.16 up 0.02 or 0.01%.
The $RUT is at 1106 up 3 or 0.28%.
NASDAQ is at 4005 up 6 or 0.14%.
NASDAQ 100 is at 3462 up 2 or 0.06%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been negative and the current bias is negative.
WTI oil is trading between 97.60 and 96.40 today. The session bias is negative and is currently trading up at 96.67.
Brent Crude is trading between 108.92 and 108.13 today. The session bias is negative and is currently trading down at 108.31.
Gold rose from 1220.13 earlier to 1234.91 and is currently trading down at 1232.40.
Dr. Copper is at 3.305 rising from 3.278 earlier.
The US dollar is trading between 80.42 and 80.14 and is currently trading up at 80.27, the bias is currently positive.
To contact me with questions, comments or constructive criticism is always encouraged and appreciated:
Written by Gary